Friday, February 25, 2011

'The Telegraph' ponders Basque Cooperative model

At a time of recession and global financial crisis, it seems that many are looking around for an alternative to the cutthroat and individualistic model that has arguably brought many economies to their knees.

Just four months after liberal US news website the Huffington Post came out in praise of the Mondragón Cooperative Corporation (MCC)'s "commitment and approach" to both business and people, UK daily The Telegraph has been weighing up its pros and cons.

Even the normally Conservative UK paper can find little to fault in the MCC's set-up of "85,000 'worker owners'", its innovative successes - "Orbea bikes that won gold at the Beijing Olympics" - or the fact that top scale bosses earn only three times more than the lowest paid worker, and not the 202 times that is currently the norm in "big Western companies".

However, the paper still questions whether the Mondragón model is exportable, pointing out that none of the MCC's plants in the rest of the world (China, India, Latin America or Europe) have opted for co-op status: "We encourage them to be owners of their future," MCC Global Director Josu Ugarte tells The Telegraph, "but they are afraid of the obligations that go with it."

The paper's International Business Editor, and author of the piece, Ambrose Evans-Pritchard, believes the co-operative model works in Mondragón for one key reason: ".. the powerful clan ethos" and "tribal loyalty" of the Basques:

"To be a Mondragon Manager is to accept the vows of priesthood," he says.

Despite criticism and scepticism over the MCC model, the movement continues to thrive, says Evans-Pritchard, "half a century after critics said it would never survive".

While even MCC Chairman, Jose María Aldecoa, declares the Mondragón model to be "absolutely flawed", The Telegraph's Business Editor agrees that, compared to other models in these times of crisis, "it has shown itself to be the least flawed".